USPS Governors Reiterate Reform Concerns in Letter to Lawmakers

The U.S. Postal Service's Board of Governors wrote lawmakers this week expressing their concern about parts of the postal reform bills in the House and Senate.

"Our primary concern is the issue of governance -- that is, the role of the regulator versus that of the Board of Governors," the governors wrote. "We believe the appropriate focus of the regulator should be oversight of postal rates (to make sure they are not too high, too low, or discriminatory). The board's role should be to oversee the business of the postal service."

Currently, mailers are waiting to see whether a bipartisan reform bill (S. 662) co-sponsored by Sens. Susan Collins, R-ME, and Tom Carper, D-DE, will be taken up by the full Senate this fall. The Senate Committee on Homeland Security and Governmental Affairs approved the bill for floor action in June. The House bill, H.R. 22, passed 410-20 July 26.

"While the legislation was intended to avoid extended rate litigation, both bills create a process that would permit the regulator to hear complaints at any time and on virtually any aspect of postal operations," the governors wrote. "The postal service would be required to take action as directed by the regulator as a result of those complaints. We are concerned that this would have the practical effect of undermining the authority of the Board and, at the same time, create the potential for constant litigation over rates and other issues."

The letter also said:

· Minor adjustments will have to be made as the postal service streamlines its network and facility infrastructure. "Our analysis of the bills suggests that the regulator would have great latitude in overseeing service standards and, potentially, intervene in decisions regarding the network," the letter said. "This additional layer of decision making could slow down or delay needed network innovation."

· The USPS should initiate a final, omnibus rate case under the current rules of the Postal Rate Commission, with metrics similar to the case now pending. "If the postal service is unable to recover certain increases in costs experienced since the last omnibus case, it would be at a significant deficit when moving into a price-cap regime," the letter said.

· The USPS should have the authority to enter into negotiated service agreements with an after-the-fact review by the regulator. "This would provide the postal service with the ability to expeditiously to assist its customers, while supporting our efforts to increase volume and revenue," the governors wrote. "We also believe that the reform legislation should contain provisions that specifically authorize the postal service to offer volume discounts in the competitive products area."

Melissa Campanelli covers postal news, CRM and database marketing for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters